Rarely have Canadian advisors operated in a time filled with such an array of disruptive factors. Whether it’s the geopolitical and market uncertainty caused by the Trump administration, the move to increased transparency via CRM2 or the CSA’s proposed ban on embedded fees, the industry is changing and advisors are being forced to adapt. In times of such volatility and uncertainty, advisors need to consider how they can take their practice to the next level; those who do not run the risk of being left behind.
“The investment industry has become a maze of choices that advisors must navigate in order to build and manage a business,” says Christopher Ambridge, President, Transcend. “Although the various combinations of technologies, investment services, operations and regulations are fairly well defined in Canada, sometimes new third party solutions present themselves and offer a chance to change your business model. In these instances it becomes increasingly difficult to determine which business model is best for you.”
Should advisors stick with their current firm and the status quo or should they explore alternative options that could potentially offer much better rewards? Deep down advisors may not be sure if the company they’re with has the best combination of resources, economics and business philosophy to enable them to grow their book of business, so how can an advisor decide the best way to proceed?
“The decision comes down to four questions in a very specific sequence and a fifth question that runs in tandem,” says Ambridge. “These questions are a decision tree that should lead to a business model that allows you to achieve both your professional and personal goals.”
1) Are you more suited to being an employee or a business owner?
2) Do you wish to outsource investment management?
3) Do you see a strategic role for commission based business in your practice?
4) How will you achieve scale to economically support your business?
5) Where will you feel a sense of cultural belonging?
Ambridge believes that the last question holds more weight than all the others. If an advisor feels they belong within their current organization and that they’re respected by its leaders; if they currently have the freedom to manage clients robustly; and if they can realize their aspirations within the framework of the current organization, then it may be worthwhile to continue in their current environment. “The opposite is also true. If you no longer feel that you belong culturally; if the people you respect are now elsewhere; if you do not have the freedom to manage your clients prudently; and if you cannot fulfill your career goals where you are, then you should consider changing your affiliation,” Ambridge says.
For more information, please visit: https://transcend.ca/advisor/